SFTP backup fails

Im trying to setup a remote location for backup with SFTP. It fails regardless what I’m doing, but it seems like it try to connect as root to the host, even if the user is setup as backup in the setup and even if I tried CFS and allowed the remote IP.

The remote server is a synology NAS so root is for security reasons disabled, and regardless it should use the credentials used in the form, should it not?

Here is the setup screenshot (IP and port is changed for privacy reasons):

Here is the error that pops up (I just removed the red thing so its easier to read: error.png - Google Drive

I tried Centos 8 and ubuntu 12 - same error on both so I dont think its the distribution.